The SEC now awards a whistleblower a whopping $37 million after the information and assistance led to a successful enforcement action.
The whistleblower persistently reported the misconduct internally within the organization.
This prompted the employer to conduct its own investigation into the matter. After completing the investigation, the employer then self-reported the findings to the regulatory Commission.
The Commission’s decision to open an investigation was a direct result of the employer’s self-report.
Furthermore, the whistleblower’s continuous, in-depth, and timely assistance was critical – without it, the Commission’s staff would not have been able to fully understand the context and scope of the employer’s misconduct.
“Today’s whistleblower learned of misconduct and made the difficult decision to report their concerns.
This individual, who was retaliated against for their whistleblowing activity, played a crucial role in the ultimate success of the enforcement proceeding,” said Creola Kelly, Chief of the SEC’s Office of the Whistleblower.
Payments to whistleblowers are made out of an investor protection fund, established by Congress, which is financed entirely through monetary sanctions paid to the SEC by securities law violators.
Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action.
Whistleblower awards can range from 10 to 30 percent of the money collected when the monetary sanctions exceed $1 million.
As set forth in the Dodd-Frank Act, the SEC protects the confidentiality of whistleblowers and does not disclose any information that could reveal a whistleblower’s identity.
Visit the whistleblower program webpage for more information, including how to report a tip.
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Also Read: S&P Global Now Raises AMC Entertainment’s Rating to CCC
Other SEC News Today
The SEC now says it is looking to make financial data more accessible to the public under the Financial Transparency Act of 2022.
The Securities and Exchange Commission (SEC) on Friday proposed new data standards for submissions to eight particular financial regulatory agencies.
These eight financial regulatory agencies include:
- Board of Governors of the Federal Reserve System
- Commodity Futures Trading Commission
- Consumer Financial Protection Bureau
- Department of the Treasury
- Federal Deposit Insurance Corporation
- Federal Housing Finance Agency
- National Credit Union Administration
- Office of the Comptroller of the Currency
“This proposal will make financial data more accessible, uniform, and useful to the public,” said SEC Chair Gary Gensler.
“Consistent data standards will make it easier for financial institutions to file reports across multiple agencies.
They also will help regulators be more effective and efficient in carrying out our oversight functions.”
The agencies are in various stages of approving the proposed joint standards, with some agencies scheduled to vote in the coming weeks.
The public comment period for the proposed joint standards will remain open for 60 days following publication in the Federal Register, according to the SEC’s press release.
Recently, the SEC charged a CEO for a whopping $170 million fraud scheme that tricked its investors about the company’s actual growth.
In its statement, the SEC charged Abraham Shafi, the founder and former CEO of the private social media startup “IRL” (Get Together Inc.), with defrauding investors.
According to the SEC’s complaint, Shafi, who resides in Pepeekeo, Hawaii, raised approximately $170 million from investors by misrepresenting IRL as a rapidly growing social media platform that organically attracted the majority of its claimed 12 million users.
In reality, the SEC alleges that IRL spent millions of dollars on advertisements that offered incentives to download the app, and Shafi concealed these marketing expenses from investors.
The SEC further alleges that Shafi failed to disclose to investors that he and his fiancée, Barbara Woortmann, used IRL’s business credit cards to pay for hundreds of thousands of dollars in personal expenses, including clothing, home furnishings, and travel.
By making false and misleading statements about the company’s growth and concealing the extensive personal use of company funds, the SEC claims that Shafi defrauded investors who provided the $170 million in funding to IRL.
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Also Read: Foreign Markets Are Now Imposing Bans For Illegal Trading
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